TIDM76TQ
RNS Number : 8711I
Nestle SA
21 April 2022
Nestlé Press Release
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.......................................
Vevey, April 21, 2022
Nestlé reports three-month sales for 2022
-- Organic growth reached 7.6%, with real internal growth (RIG)
of 2.4% and pricing of 5.2%. Growth was broad-based across most
geographies and categories, with increased pricing, continued
momentum in retail sales and a further recovery in out-of-home
channels.
-- Total reported sales increased by 5.4% to CHF 22.2 billion
(3M-2021: CHF 21.1 billion). Foreign exchange decreased sales by
0.8%. Net divestitures had a negative impact of 1.3%.
-- Portfolio management on track. In April, Nestlé Health
Science completed the acquisition of a majority stake in Orgain, a
leader in plant-based nutrition.
-- Full-year 2022 outlook confirmed : we expect organic sales
growth around 5% and underlying trading operating profit margin
between 17.0% and 17.5%. Underlying earnings per share in constant
currency and capital efficiency are expected to increase.
Mark Schneider, Nestlé CEO, commented: "In these first months of
the year, the war in Ukraine has caused unspeakable human
suffering. We remain focused on supporting our colleagues there and
providing humanitarian relief, while standing with the
international community in the call for peace.
Amid this challenging environment, we delivered strong organic
sales growth with resilient RIG. We stepped up pricing in a
responsible manner and saw sustained consumer demand. Cost
inflation continues to increase sharply, which will require further
pricing and mitigating actions over the course of the year. The
Nestlé team addressed these headwinds and advanced our long-term
strategy and sustainability objectives with agility and
determination. We confirm our guidance for the year."
Zone Zone Zone Nestlé
Total North Zone Zone Latin Greater Health Other
Group America Europe AOA America China Nespresso Science Businesses
------ -------- ------- ----- ---------- ------------ ------------ ------------- -------------
Sales 3M-2022
(CHF m) 22 238 5 800 4 633 4 633 2 697 1 361 1 602 1 449 63
Sales 3M-2021
(CHF m)* 21 089 5 887 4 535 4 497 2 357 1 265 1 571 930 47
-------------- ------ -------- ------- ----- ---------- ------------ ------------ ------------- -------------
Real internal
growth
(RIG)** 2.4% 1.4% 2.8% 1.7% 4.7% 3.8% 0.2% 4.3% 30.7%
Pricing** 5.2% 8.5% 4.1% 4.3% 7.7% * 0.5% 3.1% 1.3% 3.6%
Organic
growth** 7.6% 9.9% 6.9% 6.0% 12.5% 3.4% 3.3% 5.6% 34.3%
Net M&A** -1.3% -13.6% 0.6% -0.1% 0.1% 0.0% 0.6% 50.1% 0.0%
Foreign
exchange** -0.8% 2.2% -5.4% -2.8% 1.8% 4.2% * 2.0% 0.2% -0.6%
Reported sales
growth 5.4% -1.5% 2.2% 3.0% 14.4% 7.6% 2.0% 55.8% 33.6%
-------------- ------ -------- ------- ----- ---------- ------------ ------------ ------------- -------------
* 2021 figures restated following the creation of Zone North
America (NA) and Zone Greater China (GC)
as of January 1, 2022. Zone AOA includes Middle East and North
Africa (MENA) previously included in Zone EMENA.
**RIG, pricing and organic growth figures exclude the Russia
region, with a corresponding impact on the M&A and foreign
exchange lines. Organic growth would have been higher including the
Russia region.
Group sales
Organic growth was 7.6%, with RIG of 2.4%. Pricing increased to
5.2% to reflect significant cost inflation. Organic growth now
excludes the Russia region, given significantly disrupted trading
conditions and Nestlé's decision to focus on providing essential
food.
Growth was broad-based across most geographies and categories.
Organic growth was 6.7% in developed markets, with increased
pricing and resilient RIG following a high base of comparison in
2021. Organic growth in emerging markets was 8.8%, with strong RIG
and pricing.
By product category, Purina PetCare was the largest contributor
to organic growth led by its science-based and premium brands
Purina ONE, Purina Pro Plan and Fancy Feast as well as veterinary
products. Coffee saw high single-digit growth fueled by continued
demand for Nescafé, Starbucks and Nespresso. Sales in confectionery
grew at a double-digit rate, with strong growth for KitKat and
gifting products. Water posted double-digit growth, driven by a
further recovery of out-of-home channels and premium brands
S.Pellegrino and Perrier. Dairy reported mid single-digit growth,
with strong sales developments in coffee creamers and ice cream as
well as premium and fortified milks. Growth in Infant Nutrition
reached a mid single-digit rate, supported by improved sales
developments in the Americas and Europe. Nestlé Health Science
recorded mid single-digit growth, reflecting high demand for
Medical Nutrition and healthy-aging products. Prepared dishes and
cooking aids posted low single-digit growth following a high base
of comparison in 2021, with continued strong demand for Maggi and
Garden Gourmet.
By channel, organic growth in retail sales was 5.9%. Within
retail, e-commerce sales grew by 5.0%, building on very strong
growth of 39.6% in the first quarter of 2021. Organic growth in
out-of-home channels reached 35.6%, with sales exceeding 2019
levels.
Net divestitures decreased sales by 1.3%, largely related to the
Nestlé Waters North America transaction, which closed on March 31,
2021. Divestitures were partially offset by acquisitions, including
the core brands of The Bountiful Company. The impact on sales from
foreign exchange was negative at 0.8%. Total reported sales
increased by 5.4% to CHF 22.2 billion.
Portfolio Management
On April 1, 2022, Nestlé Health Science completed the
acquisition of a majority stake in Orgain, a leader in plant-based
nutrition. Orgain complements Nestlé Health Science's existing
portfolio of nutrition products that support healthier lives. The
deal is expected to be slightly accretive to Nestlé's organic
growth, while slightly dilutive to the Group's underlying trading
profit margin in 2022. The agreement includes the option for Nestlé
Health Science to fully acquire Orgain in 2024.
Zone North America
-- 9.9% organic growth: 1.4% RIG; 8.5% pricing.
Sales Sales Organic Net Foreign Reported
3M-2022 3M-2021 RIG Pricing growth M&A exchange Growth
--------- --------- ---- ------- ------- ------ --------- --------
Zone North CHF 5.8 CHF 5.9
America bn bn 1.4% 8.5% 9.9% -13.6% 2.2% -1.5%
----------- --------- --------- ---- ------- ------- ------ --------- --------
Organic growth was 9.9%, with RIG of 1.4%. Pricing reached 8.5%.
Net divestitures reduced sales by 13.6%, as the divestment of the
Nestlé Waters North America brands more than offset the acquisition
of Essentia Water. Foreign exchange had a positive impact of 2.2%.
Reported sales in Zone North America decreased by 1.5% to CHF 5.8
billion.
Organic growth in Zone North America was close to a double-digit
rate, supported by increased pricing, strong momentum in e-commerce
and a further recovery of out-of-home channels. The Zone saw
continued broad-based market share gains, led by pet food, coffee
and creamers.
By product category, Purina PetCare was the largest growth
contributor, supported by strong momentum in e-commerce and premium
brands, Purina ONE, Purina Pro Plan and Fancy Feast. Nestlé
Professional and Starbucks out-of-home products posted double-digit
growth. The beverages category reported high single-digit growth,
with strong demand for Starbucks at-home products and Coffee mate.
Sales in water grew at a double-digit rate, fueled by a recovery
for premium brands, S.Pellegrino and Perrier as well as continued
strong demand for Essentia. Growth in Infant Nutrition reached a
double-digit rate, reflecting supply shortages in the market.
Frozen food saw positive growth, despite supply chain constraints
and a high base of comparison in 2021. Positive sales developments
in frozen pizza and Hot Pockets were partially offset by negative
growth for frozen meals. Confectionery in Canada reported
double-digit growth, led by KitKat.
Zone Europe
-- 6.9% organic growth: 2.8% RIG; 4.1% pricing.
Sales Sales Organic Net Foreign Reported
3M-2022 3M-2021 RIG Pricing growth M&A exchange Growth
--------- --------- ---- ------- ------- ---- --------- --------
CHF 4.6 CHF 4.5
Zone Europe* bn bn 2.8% 4.1% 6.9% 0.6% -5.4% 2.2%
------------- --------- --------- ---- ------- ------- ---- --------- --------
*RIG, pricing and organic growth figures exclude the Russia
region, with a corresponding impact on the M&A and foreign
exchange lines
Organic growth reached 6.9%, with solid RIG of 2.8%. Pricing
increased to 4.1%, with an acceleration across most geographies and
categories. Foreign exchange negatively impacted sales by 5.4%.
Reported sales in Zone Europe increased by 2.2% to CHF 4.6
billion.
Zone Europe reported high single-digit organic growth, supported
by higher pricing, sustained e-commerce momentum and a further
recovery in out-of-home channels. The Zone continued to see market
share gains, particularly in pet food, coffee and plant-based
food.
By product category, the key growth driver was Nestlé
Professional, with sales exceeding 2019 levels. Sales in Purina
PetCare grew at a double-digit rate, driven by premium brands
Purina ONE, Purina Pro Plan and Gourmet as well as veterinary
products. Tails.com and Lily's Kitchen also saw strong momentum,
supported by continued distribution expansion. Sales in Infant
Nutrition grew at a double-digit rate, helped by market share
gains. Water posted double-digit growth, led by S.Pellegrino.
Confectionery reported mid single-digit growth, with a strong
recovery for KitKat and gifting products. Growth in coffee was
almost flat, following strong double-digit growth in the first
quarter of 2021. Starbucks products and Nescafé Farmers Origins, a
new range of coffee capsules for Nespresso machines, resonated
strongly with consumers. Culinary posted a sales decrease,
following a high base of comparison in 2021. Garden Gourmet
plant-based products continued to see strong momentum.
Zone Asia, Oceania and Africa (AOA)
-- 6.0% organic growth: 1.7% RIG; 4.3% pricing.
Sales Sales Organic Net Foreign Reported
3M-2022 3M-2021 RIG Pricing growth M&A exchange Growth
--------- --------- ---- ------- ------- ----- --------- --------
CHF 4.6 CHF 4.5
Zone AOA bn bn 1.7% 4.3% 6.0% -0.1% -2.8% 3.0%
--------- --------- --------- ---- ------- ------- ----- --------- --------
Organic growth reached 6.0%, with RIG of 1.7%. Pricing increased
to 4.3%, with broad-based contributions from most geographies and
categories. Foreign exchange reduced sales by 2.8%. Reported sales
in Zone AOA increased by 3.0% to CHF 4.6 billion.
Zone AOA reported mid single-digit organic growth, with
particular strength in South Asia and Sub-Saharan Africa. Growth
was supported by increased pricing, a further recovery in
out-of-home channels and continued momentum for affordable
offerings. The Zone saw market share gains in most categories,
particularly culinary, coffee and ice cream.
South-East Asia posted low single-digit growth, with robust
demand in Maggi and Nescafé, particularly in Malaysia. South Asia
recorded double-digit growth, supported by continued distribution
expansion and innovation, with strong growth for Maggi and KitKat.
Sales in Sub-Saharan Africa grew at a double-digit rate, based on
strong momentum for affordable nutrition offerings particularly in
Maggi and Milo. Middle East and North Africa posted low
single-digit growth, as robust demand in culinary was partially
offset by a sales decline in dairy. Japan reported high
single-digit growth, driven by coffee and Purina PetCare. Sales in
South Korea grew at a double-digit rate, driven by coffee. Oceania
reported mid single-digit growth, with particular strength in
Nescafé and Maggi.
By product category, culinary was the largest growth
contributor, led by Maggi. Coffee posted high single-digit growth,
with continued strong demand for Nescafé and Starbucks products.
Sales in Nestlé Professional grew at a double-digit rate. Cocoa and
malt beverages grew at a high single-digit rate. The recently
launched Milo Soy resonated strongly with consumers. Confectionery
reported high single-digit growth, with strong demand for KitKat.
Growth in Infant Nutrition turned positive, driven by Lactogen.
Sales in Purina PetCare grew at a high single-digit rate, led by
Purina Pro Plan and Purina ONE.
Zone Latin America
-- 12.5% organic growth: 4.7% RIG; 7.7% pricing.
Sales Sales Organic Net Foreign Reported
3M-2022 3M-2021 RIG Pricing growth M&A exchange Growth
--------- --------- ---- ------- ------- ---- --------- --------
Zone Latin CHF 2.7 CHF 2.4
America bn bn 4.7% 7.7% 12.5% 0.1% 1.8% 14.4%
----------- --------- --------- ---- ------- ------- ---- --------- --------
Organic growth was 12.5%, with strong RIG of 4.7%. Pricing
increased to 7.7%. Foreign exchange had a positive impact of 1.8%.
Reported sales in Zone Latin America increased by 14.4% to CHF 2.7
billion.
Zone Latin America reported double-digit organic growth,
building on a high base of comparison in 2021. Growth was supported
by strong execution and continued e-commerce momentum, with
broad-based contributions across most geographies and product
categories. The Zone saw market share gains in pet food, Infant
Nutrition and chilled dairy.
Sales in Brazil grew at a double-digit rate, with strong growth
in confectionery, cocoa and malt beverages as well as Infant
Nutrition. Mexico also reported broad-based double-digit growth,
reflecting high demand for Nescafé, Purina PetCare and Carnation.
Sales in Chile grew at double-digit rate, led by confectionery, ice
cream and Purina PetCare. The recently acquired direct-to-consumer
premium chocolate business, La Fête, saw strong demand in
Chile.
By product category, confectionery was the largest growth
contributor, in particular KitKat and gifting products. Sales in
Purina PetCare grew at a double-digit rate, led by Dog Chow, Cat
Chow and Purina Pro Plan. Coffee and Nestlé Professional also
reported strong double-digit growth. Infant Nutrition saw mid
single-digit growth, based on robust demand for Nido and NAN
functional products. Growth in dairy was flat, following a high
base of comparison in 2021.
Zone Greater China
-- 3.4% organic growth: 3.8% RIG; -0.5% pricing.
Sales Sales Organic Net Foreign Reported
3M-2022 3M-2021 RIG Pricing growth M&A exchange Growth
--------- --------- ---- ------- ------- ---- --------- --------
Zone Greater CHF 1.4 CHF 1.3
China bn bn 3.8% -0.5% 3.4% 0.0% 4.2% 7.6%
------------- --------- --------- ---- ------- ------- ---- --------- --------
Organic growth was 3.4%, with RIG of 3.8% and pricing of -0.5%.
Foreign exchange had a positive impact of 4.2%. Reported sales in
Zone Greater China increased by 7.6% to CHF 1.4 billion.
Zone Greater China reported low single-digit organic growth,
partly impacted by the timing of Chinese New Year. Growth was
supported by innovation, with market share gains in culinary,
ready-to-drink coffee and confectionery.
By product category, strong sales developments in most
categories were partly offset by a sales decline in Infant
Nutrition. Turnaround initiatives in Infant Nutrition continued.
Coffee posted double-digit growth, based on strong momentum for
Nescafé ready-to-drink and Starbucks products. Sales in culinary
grew at double-digit rate, supported by new product launches.
Nestlé Professional reported high single-digit growth, despite
regional lockdowns. Confectionery posted high single-digit growth,
led by strong demand for Shark wafer chocolate and solid growth for
Hsu Fu Chi.
Nespresso
-- 3.3% organic growth: 0.2% RIG; 3.1% pricing.
Sales Sales Organic Net Foreign Reported
3M-2022 3M-2021 RIG Pricing growth M&A Exchange growth
--------- --------- ---- ------- ------- ---- --------- --------
CHF 1.6 CHF 1.6
Nespresso* bn bn 0.2% 3.1% 3.3% 0.6% -2.0% 2.0%
----------- --------- --------- ---- ------- ------- ---- --------- --------
*RIG, pricing and organic growth figures exclude the Russia
region, with a corresponding impact on the M&A and foreign
exchange lines
Organic growth was 3.3% based on RIG of 0.2% and increased
pricing of 3.1%. Foreign exchange negatively impacted sales by
2.0%. Reported sales in Nespresso increased by 2.0% to CHF 1.6
billion.
Nespresso reported low single-digit organic growth, following
strong double-digit growth in the first quarter of 2021.
Out-of-home channels saw continued recovery, with increased
adoption for the recently launched Momento system. Growth was
fueled by continued momentum for the Vertuo system and innovation.
New products included limited editions in the Master Origins range,
Aged Sumatra and Papua New Guinea, as well as in the World
Explorations range with Miami Espresso.
By geography, North America posted double-digit growth with
continued market share gains. Europe reported a sales decrease,
following a high base of comparison in 2021. Other regions combined
recorded double-digit growth.
Nestlé Health Science
-- 5.6% organic growth: 4.3% RIG; 1.3% pricing.
Sales Sales Organic Net Foreign Reported
3M-2022 3M-2021 RIG Pricing growth M&A Exchange growth
--------- --------- ---- ------- ------- ----- --------- --------
Nestlé CHF 1.4 CHF 0.9
Health Science* bn bn 4.3% 1.3% 5.6% 50.1% 0.2% 55.8%
----------------- --------- --------- ---- ------- ------- ----- --------- --------
*RIG, pricing and organic growth figures exclude the Russia
region, with a corresponding impact on the M&A and foreign
exchange lines
Organic growth was 5.6%, with robust RIG of 4.3% and increased
pricing of 1.3%. Net acquisitions increased sales by 50.1%, largely
related to the acquisition of the core brands of The Bountiful
Company. Foreign exchange positively impacted sales by 0.2%.
Reported sales in Nestlé Health Science increased by 55.8% to CHF
1.4 billion.
Nestlé Health Science posted mid single-digit organic growth
with market share gains, building on two consecutive years of
double-digit growth. Growth was supported by innovation and
geographic expansion.
Consumer Care posted low single-digit growth. Healthy-aging
products grew at a double-digit rate, supported by Boost and
Nutren. Vitamins, minerals and supplements posted slightly positive
growth, following a high base of comparison in early 2021 during
the pandemic. Vital Proteins and Solgar continued to see strong
momentum.
Medical Nutrition saw double-digit growth with continued strong
sales developments for pediatric products, particularly Althéra,
Alfaré and Alfamino. Palforzia, the peanut allergy treatment, saw
signs of increased adoption after COVID-related delays.
By geography, sales in North America grew at a mid single-digit
rate. Europe saw a slight sales decrease. Other regions posted
double-digit growth.
Providing humanitarian relief to the people of Ukraine
Since the beginning of the war, Nestlé has focused on supporting
its employees, their families and the people of Ukraine. The
company has mobilized teams across the region to get food and
essential supplies to the local population. Working in partnership
with Ukrainian charities, Nestlé has also organized direct
humanitarian support in the war zone.
Nestlé is one of the few companies that continues to keep
shelves stocked for the population in Ukraine. The company was able
to largely maintain operations in the west of the country, whereas
operations of its factory in Kharkiv were halted due to heavy
shelling. Nestlé employees volunteered to transform the company's
Kharkiv Distribution Center into a donation center to provide food
to the local community. To date Nestlé has donated more than 40
million servings of food, beverage and nutrition products across
the country.
Nestlé has been and continues to be in close contact with its 5
800 employees in Ukraine. Among other measures, the company is
providing them with advance salary payments, one-off payments to
support relocation, salary continuance for the foreseeable future
and job offers in other Nestlé operating companies.
Additionally, Nestlé has set up support hubs in neighboring
countries, such as Poland, to welcome employees and their families
who have fled Ukraine. For example, part of the company's factory
in Rzeszow, Poland has been converted into accommodation for those
fleeing, and temporary housing has been arranged in other parts of
Central and Eastern Europe.
Nestlé employees all over the world are bringing to life the
company's long tradition of humanitarian support. They are
supporting humanitarian relief efforts through donations to The
International Federation of Red Cross and Red Crescent Societies
(IFRC), with the company matching all contributions to double their
impact. The company has also supported Global Citizen's
#StandUpForUkraine campaign, pledging monetary support to Global
Giving that will provide critical relief for refugees who have fled
Ukraine. In total, Nestlé has committed more than CHF 15 million in
monetary and product contributions to the people of Ukraine this
year.
Outlook
Full-year 2022 outlook confirmed : we expect organic sales
growth around 5% and underlying trading operating profit margin
between 17.0% and 17.5%. Underlying earnings per share in constant
currency and capital efficiency are expected to increase.
Contacts
Media
Christoph Meier
Tel.: +41 21 924 2200
mediarelations@nestle.com
Investors
Luca Borlini
Tel.: +41 21 924 3509
ir@nestle.com
Annex
Three-month sales overview by operating segment
Zone Zone Zone Nestlé
Total North Zone Zone Latin Greater Health Other
Group America Europe AOA America China Nespresso Science Businesses
------ -------- ------- ----- ---------- ------------ ------------ ------------- -------------
Sales 3M-2022
(CHF m) 22 238 5 800 4 633 4 633 2 697 1 361 1 602 1 449 63
Sales 3M-2021
(CHF m)* 21 089 5 887 4 535 4 497 2 357 1 265 1 571 930 47
-------------- ------ -------- ------- ----- ---------- ------------ ------------ ------------- -------------
Real internal
growth
(RIG)** 2.4% 1.4% 2.8% 1.7% 4.7% 3.8% 0.2% 4.3% 30.7%
Pricing** 5.2% 8.5% 4.1% 4.3% 7.7% * 0.5% 3.1% 1.3% 3.6%
Organic
growth** 7.6% 9.9% 6.9% 6.0% 12.5% 3.4% 3.3% 5.6% 34.3%
Net M&A** -1.3% -13.6% 0.6% -0.1% 0.1% 0.0% 0.6% 50.1% 0.0%
Foreign
exchange** -0.8% 2.2% -5.4% -2.8% 1.8% 4.2% * 2.0% 0.2% -0.6%
Reported sales
growth 5.4% -1.5% 2.2% 3.0% 14.4% 7.6% 2.0% 55.8% 33.6%
-------------- ------ -------- ------- ----- ---------- ------------ ------------ ------------- -------------
Three-month sales overview by product
Milk Prepared
Powdered products Nutrition dishes
Total & liquid & ice & Health & cooking
Group beverages Water cream Science aids Confec-tionery PetCare
------ ---------- ----- --------- --------- ---------- -------------- -------
Sales 3M-2022
(CHF m) 22 238 6 063 790 2 709 3 596 3 098 1 873 4 109
Sales 3M-2021
(CHF m) 21 089 5 771 1 389 2 598 2 995 3 016 1 700 3 620
----------------- ------ ---------- ----- --------- --------- ---------- -------------- -------
Real internal
growth (RIG)** 2.4% 2.4% 14.1% -1.4% 2.5% -3.5% 7.5% 5.8%
Pricing** 5.2% 4.9% 7.2% 5.6% 2.0% 6.4% 3.0% 7.7%
Organic growth** 7.6% 7.3% 21.3% 4.2% 4.5% 2.9% 10.5% 13.6%
----------------- ------ ---------- ----- --------- --------- ---------- -------------- -------
* 2021 figures restated following the creation of Zone North
America (NA) and Zone Greater China (GC)
as of January 1, 2022. Zone AOA includes Middle East and North
Africa (MENA) previously included in Zone EMENA.
**RIG, pricing and organic growth figures exclude the Russia
region, with a corresponding impact on the M&A and foreign
exchange lines. Organic growth would have been higher including the
Russia region.
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